COMMISSIONER OF WEALTH TAX VS S.B. ANWAR BEGUM
1999 P T D 947
[232 I T R 818]'
[Andhra Pradesh High Court (India)]
Before Syed Shah Mohammed Quadri and B.S. Raikote, JJ
COMMISSIONER OF WEALTH TAX
Versus
S.B. ANWAR BEGUM
Wealth Tax Case No.4 of 1991, decided on 07/11/1996.
Wealth tax---
----Asset---Right to wear jewellery on ceremonial occasions vesting in one of beneficiaries of jewellery fund of trust---Does not constitute beneficial interest within the meaning of S.2(e)---Not includible for direct assessment on beneficiary under S.21(2)---Indian Wealth Tax Act, 1957, Ss.2(e) & 21(2).
The right to wear jewellery on ceremonial occasions vesting in one of the beneficiaries of the jewellery fund of the trust could not be considered to be property for purpose of wealth tax and does not constitute beneficial interest within the meaning of section 2(e) of the Wealth Tax Act, 1957, and is not to be included for direct assessment on the beneficiary under section 21(2) of the Act.
CWT v. Trustees of H.E.H. The Nizam's Wedding Gifts Trust (1995) 216 ITR 232 (AP) fol.
S.R. Ashok for Applicant.
P. Murali Krishna for Respondent.
JUDGMENT
SYED SHAH MOHAMMED QUADRI, J.--- This is an application under section 27(3) of the Wealth Tax Act, 1957, for short "the Act". The Revenue is the petitioner. It seeks a direction to the Income-tax Appellate Tribunal to state the case and refer the following questions as questions of law to this Court for opinion:
"(1) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is correct in law in holding that the value of the jewellery fund in part 1 of the Schedule to the SB. Anwar Begum Trust should not be included on the ground that there is no beneficial interest of the assessee, within the meaning of section 2(e) of the Wealth Tax Act, 1957?
(2) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is correct 'in law in confirming the order of the Commissioner of Income-tax (Appeals) holding that the value of the jewellery mentioned in question No. l above should not be included for direct assessment on the beneficiary under section 21(2) of the Wealth Tax Act?"
For the assessment years 1977-78 to 1982-83, the Wealth tax Officer valued the right to wear jewellery on ceremonial occasions, vested in one of the grand daughters of H.E.H. the Nizam, and accordingly assessed the same under section 21(1) of the Act. On appeal, the Commissioner of Wealth Tax (Appeals) set aside the assessment. The Revenue preferred an appeal before the Income-tax Appellate Tribunal against the said order of the Commissioner of Wealth-tax (Appeals). The Tribunal, following the judgment of a Division Bench of this Court in R.C. No.67 of 1969, dated November 5, 1971, held that the right to wear jewellery, however, widely the expression might be interpreted, could not be considered to be property for the purpose of wealth tax and, thus, dismissed the appeal of the Revenue on May 30, 1989. The application of the petitioner under section 27(1) of the Act to refer the said questions to this Court, filed before the Tribunal was dismissed on September 26, 1989. On these facts, the petitioner has filed this petition.
Learned standing counsel for the petitioner submits that an identical question has been referred to the Full Bench and, therefore, this case may also be referred to the Full Bench. Sri Murali Krishna, learned counsel for the respondent, submits that the question now sought to be referred, was not one of the questions referred to the Full Bench. He further contends that the question is covered by not merely the judgment relied upon by the Tribunal, but also another judgment of this Court in CWT v. Trustees of H.E.H. The Nizam's Wedding Gifts Trust (1995) 216 ITR 232 and, therefore, the petition is liable to be dismissed.
We have perused the order relied upon by learned junior standing counsel for the Revenue in R.C. No.41 of 1989, dated February 23, 1995. It relates to the interpretation of the trust deed executed by H.E.H. the Nizam on March 21, 1953, viz. Sahebzadi Anwar Begun Trust. The present case arises out of the trust known as the Nizam's Wedding Gifts Trust for two grand daughters, dated September 4, 1951. A Division Bench of this Court, of which one of us was a member (Syed Shah Muhammad Quadri, J.) in CWT v. Trustees of H.E.H. The Nizam's Wedding Gifts Trust (1995) 216 ITR 232, declined to refer an identical question. That case related to the assessment years 197ti-77 to 1980-81. Following the judgment in R.C. No.67 of 1969, dated November 5, 1971, the Bench held as follows (page 234)
"From the extract of the judgment of the High Court in R.C. No.67 of 1969, dated November 5, 1971, quoted by the Tribunal, we may note the following observation made by Justice O. Chinnappa Reddy, as he then was, speaking for the Bench. The learned Judge observed, "her interest in the jewels is limited to being allowed to wear them if the trustees do not withdraw them from her. To our minds, the interest appears to be of a permissive nature and cannot be called property, however, widely the expression may be interpreted. We, therefore, agree with the Tribunal that neither the interest of the Sahebzadi in the jewellery fund nor her interest in the shares fund is an asset within the meaning of the Wealth Tax Act. We are in entire agreement with the observation of the Bench. In view of the said observation, the point is squarely covered by a binding judgment of this Court. Therefore, no referable question of law arises."
In view of the above position, we opine that no referable questions of law arise. Accordingly, the wealth tax case is dismissed.
M.B.A./18811FC Application dismissed.